RSA Insurance Group Plc, the U.K.’s biggest non-life insurer by market value, posted a 14 percent increase in first-half profit, missing analysts’ estimates as investment income declined.
Pretax profit rose to £250 million ($380 million) in the six months to June 30, from £219 million [$332.9 million] in the year- earlier period, London-based RSA said in a statement today. That missed the £291 million [$442 million] median estimate of seven analysts surveyed by Bloomberg News. Earnings from investments fell by £19 million [$28.87 million] to £206 million [$313 million].
“The outlook for earnings is positive,” CEO Simon Lee said in the statement. “The reduction in earnings from lower interest rates is beginning to slow down.”
The insurer said its combined ratio, or claims and expenses as a percentage of premiums, fell to 94.2 percent from 95.4 percent, indicating improved underwriting even after the company paid out claims relating to “severe flooding” in Alberta, Canada.
RSA also reduced its first-half payout to shareholders to 2.28 pence a share from 3.41 pence in the year earlier period.
Profit after tax rose to £190 million [$288.75 million], from £153 million [$232.6 million].
Editors: Jon Menon, Keith Campbell
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